NGOs’ Initiatives to Enhance Social Sustainability in the Supply Chain : Poverty Alleviation Through Supplier Development Programs

Previous research suggests that creative collaborations with non-traditional chain members such as non-governmental organizations (NGOs) could pave the way for making supply chains sustainable. In extant research, NGOs help focal firms achieve their goals in a more sustainable manner. However, NGOs, regulators and other non-profits have objectives and supply chains of their own, something previous research has generally overlooked. This research addresses this point by studying how NGOs undertake socially sustainable supply chain practices in contexts in which synergies between social and economic performance were not initially foreseen. The research inductively builds a theoretical framework that explains how NGOs use supplier development (SD) programs to alleviate poverty. The framework posits that the NGO-resources of knowledge for localizing SD programs and a bridging capability are critical for designing and setting up the SD program. The NGO resources are complimented by the buying firm-resources of knowledge transfer routines, logistical resources, and relational contracting based on procedural fairness that are critical to carry out the transactions and protect the value in the buyer-supplier relationship. NGO resources and buying firm-resources are inter-temporal complements that enhance a supply chain’s social sustainability